Pak agencies, LeT pumping fake currency: Govt

ET BureauAug 5, 2009, 02.25am IST

NEW DELHI: With Pakistan-based terror outfits targeting the Indian economy by pumping in massive amounts of fake currency, the government informed Parliament on Tuesday that it was the Lashkar-e-Taiba (LeT) and Pakistani intelligence agencies which were involved in the operation.

Ministers speaking in both Houses pointed to the Pakistan connection in the Fake Indian Currency Notes (FICN) racket which has assumed serious proportions in the wake of reports that the counterfeit currency is also being used for terror funding.

Even India has diplomatically pushed for Pakistan to crack down on terror groups operating its soil in the wake of the 26/11 Mumbai attacks, the terrorist organisations have attempted to use unconventional methods. Though the Pakistan links in the FICNs racket existed even before the Mumbai attacks, reports of recoveries of counterfeit currency have increased after 26/11, thus forcing the Indian establishment to step up vigilance on this front.

Minister of state (MoS) for home Ajay Maken told Lok Sabha that the LeT along with organised criminal networks and syndicates was involved infusing and circulating FICNs, whereas MoS finance Namo Narain Meena told Rajya Sabha that "involvement of Pakistan officials suspected to be working for intelligence agencies of Pakistan has been revealed".

Mr Maken, in a written reply, said high quality FICNs were printed in a "neighbouring country" and were "pushed into India through neighbouring countries".

He also added that India concerns on the printing and circulation of FICNs were being raised in the bilateral mechanisms established to address India's security concerns. Mr Meena, who was replying to questions, spoke of the measures taken by the government to curb circulation of fake currency, including increased vigilance by the Border Security Force and customs authorities.

The government has appointed a high-level committee headed by the Union home secretary and comprising officials from central agencies to monitor and chalk out a strategy to check the influx of fake currency. The seriousness of the problem can be assessed from the fact that the government has handed over the investigations into the FICN racket to the National Investigative Agency (NIA) even as the CBI remains the nodal agency for co-ordinating with the states in probing such cases.

According to the figures disclosed by the government in the Upper House recently, 7.34 lakh of Rs 100 notes, 5.76 lakh of Rs 500 notes and 1.09 lakh of Rs 1000 notes, all fakes, had been seized during the 2006-09 period. Though the RBI has said there is no record of the forged notes in circulation, there are differing estimates of the actual value of such currency.

The National Crime Records Bureau of the home ministry has said that in 2007, 2008 and January-March 2009 there were Rs 10.54 crore, Rs 21.45 crore and Rs 4.09 crore of fake notes recovered through the banks.

The government has also said it will broach the matter at international fora, including with the EU and countries such as Britain which export the ink and printing paper to Pakistan from where Indian investigators suspect the printing of the notes is carried out.